Insi Ltd manufactures product J7524G and provides the following information for the last month: Budgeted figures: Variable manufacturing overheads R20 000 Fixed manufacturing overheads R48 000 Labour hours 4 000 Expected production 1 000 units Actual results: Variable manufacturing overheads R19 135 Fixed manufacturing overheads R49 880 Labour hours worked 4 300 Actual production 1 050 units Required: 1. Calculate the following variable manufacturing overheads variances (in Rands) and state if they are favourable or unfavourable: 1.1 Efficiency variance 1.2 Expenditure variance 1.3 Total variable overheads variance

Insi Ltd manufactures product J7524G and provides the following information for the last month: Budgeted figures: Variable manufacturing overheads R20 000 Fixed manufacturing overheads R48 000 Labour hours 4 000 Expected production 1 000 units Actual results: Variable manufacturing overheads R19 135 Fixed manufacturing overheads R49 880 Labour hours worked 4 300 Actual production 1 050 units Required: 1. Calculate the following variable manufacturing overheads variances (in Rands) and state if they are favourable or unfavourable: 1.1 Efficiency variance 1.2 Expenditure variance 1.3 Total variable overheads variance

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter8: Standard Cost Accounting—materials, Labor, And Factory Overhead

Section: Chapter Questions

Problem 21E: Georgia Gasket Co. budgets 8,000 direct labor hours for the year. The total overhead budget is...

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Georgia Gasket Co. budgets 8,000 direct labor hours for the year. The total overhead budget is expected to amount to 20,000. The standard cost for a unit of the companys product estimates the variable overhead as follows: The actual data for the period follow: Using the four-variance method, calculate the overhead variances. (Hint: First compute the budgeted fixed overhead rate.)
Nashler Company has the following budgeted variable costs per unit produced: Budgeted fixed overhead costs per month include supervision of 98,000, depreciation of 76,000, and other overhead of 245,000. Required: 1. Prepare a flexible budget for all costs of production for the following levels of production: 160,000 units, 170,000 units, and 175,000 units. 2. What is the per-unit total product cost for each of the production levels from Requirement 1? (Round each unit cost to the nearest cent.) 3. What if Nashler Companys cost of maintenance rose to 0.22 per unit? How would that affect the unit product costs calculated in Requirement 2?
Business Specialty, Inc., manufactures two staplers: small and regular. The standard quantities of direct labor and direct materials per unit for the year are as follows: The standard price paid per pound of direct materials is 1.60. The standard rate for labor is 8.00. Overhead is applied on the basis of direct labor hours. A plantwide rate is used. Budgeted overhead for the year is as follows: The company expects to work 12,000 direct labor hours during the year; standard overhead rates are computed using this activity level. For every small stapler produced, the company produces two regular staplers. Actual operating data for the year are as follows: a. Units produced: small staplers, 35,000; regular staplers, 70,000. b. Direct materials purchased and used: 56,000 pounds at 1.5513,000 for the small stapler and 43,000 for the regular stapler. There were no beginning or ending direct materials inventories. c. Direct labor: 14,800 hours3,600 hours for the small stapler and 11,200 hours for the regular stapler. Total cost of direct labor: 114,700. d. Variable overhead: 607,500. e. Fixed overhead: 350,000. Required: 1. Prepare a standard cost sheet showing the unit cost for each product. 2. Compute the direct materials price and usage variances for each product. Prepare journal entries to record direct materials activity. 3. Compute the direct labor rate and efficiency variances for each product. Prepare journal entries to record direct labor activity. 4. Compute the variances for fixed and variable overhead. Prepare journal entries to record overhead activity. All variances are closed to Cost of Goods Sold. 5. Assume that you know only the total direct materials used for both products and the total direct labor hours used for both products. Can you compute the total direct materials and direct labor usage variances? Explain.
ABC Inc. spent a total of $48,000 on factory overhead. Of this, $28,000 was fixed overhead. ABC Inc. had budgeted $27,000 for fixed overhead. Actual machine hours were 5.000. Standard hours for units made were 4,800. The standard variable overhead rate was $4.10. What is the variable overhead rate variance?
A company estimates its manufacturing overhead will be $840,000 for the next year. What is the predetermined overhead rate given each of the following Independent allocation bases? Budgeted direct labor hours: 90,615 Budgeted direct labor expense: $750000 Estimated machine hours: 150,000
Calculating amount of factory overhead applied to work in process The overhead application rate for a company is 2.50 per unit, made up of 1.00 for fixed overhead and 1.50 for variable overhead. Normal capacity is 10,000 units. In one month, there was an unfavorable flexible budget variance of 200. Actual overhead for the month was 27,000. What was the amount of the budgeted overhead for the actual level of production?
Refer to Exercise 8.27. At the end of the year, Meliore, Inc., actually produced 310,000 units of the standard model and 115,000 of the deluxe model. The actual overhead costs incurred were: Required: Prepare a performance report for the period. In an attempt to improve budgeting, the controller for Meliore, Inc., has developed a flexible budget for overhead costs. Meliore, Inc., makes two types of products, the standard model and the deluxe model. Meliore expects to produce 300,000 units of the standard model and 120,000 units of the deluxe model during the coming year. The standard model requires 0.05 direct labor hour per unit, and the deluxe model requires 0.08. The controller has developed the following cost formulas for each of the four overhead items: Required: 1. Prepare an overhead budget for the expected activity level for the coming year. 2. Prepare an overhead budget that reflects production that is 10 percent higher than expected (for both products) and a budget for production that is 20 percent lower than expected.
The following information is available for Baxter Manufacturing for April: Actual machine hours Standard machine hours allowed Denominator activity (machine hours) Actual fixed overhead costs Budgeted fixed overhead costs Predetermined overhead rate ($2 variable + $5 fixed) What is the production volume variance? 925 1,070 1,200 $ 5,500 $ 6,000 $ 7 Multiple Cholce $650 $1,015 $725 9400
Hemlock, Inc. uses standard costing and has set the following production standards for direct labor (DL). Standard direct labor hours (DLHs) per unit Standard wage rate 2 DLHs $18.00 per DLH 5,000 units Budgeted Units to be produced For the most recent month of operation, Hemlock recorded the following. Actual Units Produced Direct labor rate variance Actual cost of direct labor 16 What were the actual DLHs for the month? A. 10.200 DLHs 10,100 DLHs 10.240 DLHS 10,000 DLHs B. C. D. E. None of the above 5,100 units $120 Unfavorable $184.440
The standard cost card for a single unit of Robinson, Incorporated's products is shown below. Direct materials: Direct labor: Variable overhead (based on labor hours): Budgeted production for the month Actual production for the month Standard Quantity Standard Price/Rate 2.5 yards @ $ 8.00 per yard 0.5 hours @ $18.00 per hour 0.5 hours @ $ 10.00 per hour 14,000 units 13,500 units Actual Costs Incurred to Produce 13,500 units: Direct Materials Purchased and Used Direct Labor Paid Variable Overhead Incurred Standard Quantity 35,100 yards @ 7,425 hours @ 7,425 hours @ 1. Compute the direct material, direct labor and variable overhead variances. Standard Unit Cost $20.00 9.00 5.00 Standard Price/Rate $7.00 per yard $17.50 per hour $12.00 per hour Total Actual Cost $2,45,700 $1,29,938 $ 89,100
Coe Parts applies fixed overhead at the rate of $6.82 per unit. Budgeted fixed overhead was $198,600. This month 28,240 units were produced, and actual fixed overhead was $193,490. Required: a. What are the fixed overhead price and production volume variances for Coe Parts? b. What was budgeted production for the month? Complete this question by entering your answers in the tabs below. Required A Required B Jhm What are the fixed over ad price and production volume variances for Coe Parts? Note: Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option. Do not round your intermediate calculations. Round your final answers to the nearest dollar. Fixed overhead price variance Fixed overhead production volume variance Required A Required B >
Rockport Corporation uses the cost formula Y- $4,800+ $0.40X for the maintenance cost, where X is machine-hours. The August budget is based on 9,000 hours of planned machine time. Maintenance cost expected to be incurred during August is: O $4,800 O $8,400 O $3,600 O $1,200